Bloomberg- Japan’s government bonds rose as reports of increasing losses at hedge funds globally spurred demand for the relative safety of government debt.<\/p>\n
Ten-year bonds gained for a second day, pushing yields to the lowest in nine weeks. Emerging-market and corporate debt fell yesterday on concern investors will cut holdings of riskier assets after Bear Stearns Cos. halted redemptions from a third hedge fund. Yields on 10-year U.S. Treasuries fell to the least since May. Japan’s key stock indexes erased gains for this year.<\/p>\n
“This is typical of a flight to quality,” said Tetsu Aikawa, deputy general manager of the capital markets division at Shinsei Bank Ltd. in Tokyo. “Stocks are falling on concern over financial institutions, boosting bonds.”<\/p>\n
The yield on the benchmark 10-year bond fell 4 basis points to 1.75 percent as of 3:03 p.m. in Tokyo according to Japan Bond Trading Co., the nation’s largest interdealer debt broker. The price of the 1.9 percent security due in June 2017 rose 0.339 yen to 101.262 yen. A basis point is 0.01 percentage point.<\/p>\n
Ten-year bond futures for September delivery gained 0.35 to 133.50 as of the afternoon close on the Tokyo Stock Exchange.<\/p>\n
Macquarie Fortress Investments Ltd., a fund run by Australia’s largest securities firm, was forced to sell assets and use the proceeds to reduce borrowings and comply with lending covenants, it said in a statement yesterday. Investors may lose A$300 million ($255 million), the Australian newspaper reported earlier.<\/p>\n